Gala IPO Could Be Slated For Late 2005
The Gala Group, Britain's largest bingo operator, is reportedly considering a float on the London Stock Exchange. The company on Thursday viewed presentations from five banks, including UBS, Deutsche Bank and Merrill Lynch, that would like to advise the company's IPO. Owned by private equity firms Cinven and Candover, Gala could float with a valuation of £1.8 billion. The company has not announced a timeline, but analysts for the Financial Times forecast an IPO for the fourth quarter of 2005 or the first quarter of 2006. The motivation for the float has likely been spurred on by the recent passage of Britain's Gambling Act, which benefits Gala in a number of ways. For example, the Act repeals a rule that requires new customers to register at a club at least 24 hours before they play. The company will also be able to roll over prize money at its clubs on a weekly basis to create bigger, more attractive payouts. Gala's 166 bingo clubs (with 5.5 million customers) generate 80 percent of its earnings, with the rest coming from its casinos (1.5 million customers).
Odds on Stanley Breakup
Rumors are circulating that Stanley Leisure Organisation Plc (SLY.L) could be a target for takeover because of its rich asset base and strong cash flow. According to The Independent, most market professionals are expecting a breakup bid for the company, whereby a private-equity house would take control of the firm and then sell off the casino business. Malaysian conglomerate Genting Berhard, which owns the largest stake in Stanley (17 percent), is a candidate to purchase the casino business. Genting also holds a 22 percent share of London Clubs International.
Gaming Transactions Considers AIM Listing
Gaming Transactions Inc. (GGTS.PK), the Pink Sheets-listed owner of Keno.com, says it has held initial discussions with financial and brokerage companies and is evaluating listing its common stock on the Alternative Investment Market of the London Stock Exchange. The company's CEO, Patrick Smyth, says an AIM-listing would benefit the company by giving its viability and profile in the I-gaming market place.
London Clubs Profit Warning
London Clubs International Plc (LCI.L) issued a profit warning last week to announce that trading at its Les Ambassadeurs casino and disruption to the operation of two of its other London casinos has resulted in the reduction of the company's profit expectation for the year ended March 27, 2005. The company's operating profit for the year as a whole will be significantly below last year, but not less than what was reported for the half year.
Reports Released
Racecourse group Arena Leisure Plc (ARE.L) recorded its best financial year in 2004 since its formation in 1997. The company reported a material improvement in profit before tax to £0.2 million (up from a £42.2 million loss in 2003) and a fundamental improvement in profit after tax to £5.3 million. Basic earnings per share have risen to 1.5 pence from a loss of 11.7 pence last year, and for the first time in the company's existence shareholders will receive a dividend of 0.3p per share. "The transformation since four years ago is remarkable, and the company is in the best position it has ever been," CEO Ian Penrose said. "The racecourses have produced very encouraging results in a period of major change and uncertainty, and the performance of ATR is a key indicator that this is a business in a very sound position which is no longer costing Arena money."
Arena Leisure Plc - Annual Report